When will next season start? Return to Play Negotiations

[iggy_oi]

Originally Posted by Textcritic

Based on everything I have seen the availability of vaccines to the wider public will not occur until summer 2021 at the earliest.

I honestly don't care about who wins the optics war in this new fight between owners and players, so long as there is a feasible and sustainable model for NHL hockey beyond 2021. If the players insist on enforcement of the current agreement with no regard to the certain revenue-loss for this season, then I believe that future is very much in doubt. As much as you see "the league trying to have their cake and eat it too," I think this applies just as clearly to the PA, which seems set on jeopardizing long-term sustainability for immediate compensation.

I disagree, the PA is in a position where going forward they have already committed to a having a much higher escrow for the next few seasons and being paid a lower percentage of their contract value, even if things were to return to normal for the 21/22 season the players would still be on the hook for the concessions they agreed to. If the league were to come out and say they want to renegotiate the whole deal that’d be one thing but what they’re doing here is saying next year the deal looks bad for the league so they want the players to take less, but in the following two seasons where the deal is looking worse for the players the league thinks status quo is ok. I don’t see how that can be described as anything other than cake eating.

[GreenLantern2814]

It seems ridiculous that the PA would choose nothing over something, and there’s no way they’re going to win this PR battle.

[iggy_oi]

Originally Posted by GreenLantern2814

It seems ridiculous that the PA would choose nothing over something, and there’s no way they’re going to win this PR battle.

If they feel it’s likely they’ll be heading to another lockout if they allow the league to make these changes it makes more sense for the players to miss out on a season where they aren’t going to be getting the full value of their contracts as opposed to one where they would be getting full value.

Also the league has already agreed to terms with the PA and the league is seeking to amend that agreement. So if the players reject the league’s proposal it’ll be the league who will be left with the decision of whether or not they want to play out the season.

I still maintain that the timing of this comes off as as suspicious, if the league is that concerned with the financial implications of player salaries why are they not opting to have 2 host city bubbles again instead of taking on all the additional expenses of running an extra 20+ buildings and incurring all the extra travel costs of flying from city to city? Doesn’t make a lot of sense.

[Enoch Root]

Originally Posted by CASe333

But from the players point of view most owners are billionaires so why should they or the fans have any sympathy for them?

It isn't about millionaires and billionaires, that is an empty argument.

The fact is that players wanted their salaries to be directly tied to revenues. They fought hard for that, and for good reason - as revenues go up, their salaries rise along with them. In other words, they fully participate in the success of the business.

The underbelly of that privilege is that, when revenues go down, so too must salaries. Either you want to be a stakeholder, or you don't. But you can't participate only on the sunny side.

[iggy_oi]

Originally Posted by Monahammer

Look at what Australia did. Maybe some of the owners were thinking that governments here would be that bold and there'd be enough of a tamper on numbers to host some type of public events again. They're about to host a 52,000 person event in Brisbane: https://www.abc.net.au/news/2020-11-...ntage/12892044

If the NHL signed off on this agreement based on their expectation of a best possible outcome then why would they deserve a mulligan? That’s a terrible way to run any business, let alone a major pro sport league.

[Enoch Root]

Originally Posted by iggy_oi

What level of uncertainty did you think they expected? Serious question. There was no vaccine and everyone was under lockdown or just coming out of it at the time this agreement was signed. I think the league ought to have known that a second or third wave was likely, if they didn’t they likely wouldn’t had made provisions for the next 3 years in this deal.

The flip side of this coin is that we now know a vaccine will likely be available by early next year which will likely make the following seasons much more “normal” yet I’m sure the league is still expecting the players to adhere to the elevated escrow levels and cap freezes they’ve agreed to for those seasons.

Unless I’m wrong and the league has committed to renegotiating those rates if things recover then this just comes off as the league trying to have their cake and eat it too. I understand from the businesses perspective why they’re trying to do it but I think it’s a pretty short sighted move and undoes a lot of the work that has been done to mend fences between the NHL and the NHLPA.

No, if revenues return to normal more quickly than currently anticipated, so will player salaries. 50% of HRR is pretty straight-forward, unless you are purposely advancing a bias.

[iggy_oi]

Originally Posted by Enoch Root

It isn't about millionaires and billionaires, that is an empty argument.

Glass houses.

The fact is that players wanted their salaries to be directly tied to revenues. They fought hard for that, and for good reason - as revenues go up, their salaries rise along with them. In other words, they fully participate in the success of the business.

You and Locke must live in an alternate reality from the rest of us. The players don’t want their salaries directly tied to revenues, this has been made very clear by their wanting to remove escrow from the CBA. Empty argument indeed.

The underbelly of that privilege is that, when revenues go down, so too must salaries. Either you want to be a stakeholder, or you don't. But you can't participate only on the sunny side.

If the league gave the players the option of removing the salary cap and escrow do you think they would choose that? If your answer is yes that should give you a pretty good indication of how misguided the revisionist history you’re applying to make your argument is.

[Textcritic]

Originally Posted by iggy_oi

...I still maintain that the timing of this comes off as as suspicious, if the league is that concerned with the financial implications of player salaries why are they not opting to have 2 host city bubbles again instead of taking on all the additional expenses of running an extra 20+ buildings and incurring all the extra travel costs of flying from city to city? Doesn’t make a lot of sense.

Gee, I wonder if it has anything to do with the fact that players are not enthusiastic about isolating in highly controlled hubs for weeks or months on end.

[Enoch Root]

Originally Posted by iggy_oi

Glass houses.



You and Locke must live in an alternate reality from the rest of us. The players don’t want their salaries directly tied to revenues, this has been made very clear by their wanting to remove escrow from the CBA. Empty argument indeed.



If the league gave the players the option of removing the salary cap and escrow do you think they would choose that? If your answer is yes that should give you a pretty good indication of how misguided the revisionist history you’re applying to make your argument is.

You are confusing revenue sharing with escrow. The players don't like escrow because they don't understand it.

They very much do like revenue sharing though.

[Bingo]

I haven't dug into the details, but from a distance I think this is more about escrow timing than anything.

The escrow true up will solve whatever the revenue short fall is ... in time. But if they set the ratio to games played when the actual pie shrink will be more than that. And if that's the case some teams may not make it out the other side.

It's not a simple proration.

Did some digging on revenues and roughly the following seems to be true.

Total Revenue - $5B USD
Tickets & Concession 44% or $2.2B
TV 49% or $2.4B
Other 7% or $0.4B

If they play say 56 games it's not as simple as 56/82 * $5B. The proration works for TV and it works for "other", but the first category becomes zero.

At zero for tickets and concession etc the pie shrinks to $1.9B or 38% of the 2018-19 season.

That's not easy to finance as you wait for the escrow smoothing to fix things.

[iggy_oi]

Originally Posted by Enoch Root

No, if revenues return to normal more quickly than currently anticipated, so will player salaries. 50% of HRR is pretty straight-forward, unless you are purposely advancing a bias.

Facts have no bias. The players are obligated to pay the elevated escrow and to take the salary cuts they agreed to regardless of what happens. Not sure what you’re basing your argument of that not being the case on.

[iggy_oi]

Originally Posted by Textcritic

Gee, I wonder if it has anything to do with the fact that players are not enthusiastic about isolating in highly controlled hubs for weeks or months on end.

I’m sure they’re not huge fans of the idea, but if the viability of the league is in jeopardy you would think the owners would be pushing this before they would attempt to reneg on a CBA as it provides financial relief and is actually somewhat in their control.

[Strange Brew]

Originally Posted by Locke

I dont see the problem here. The players wanted to be partners. 50/50.

If the revenue isnt there, they have to shoulder their share. Regardless of the previous agreement.

Things changed.

Its annoying that people want to be in for the good times, but sheltered from the pot-holes.

They see the owners making a lot of money and they want their share, but when things go bad they want no part of it.

Yeah, the owners make a lot of money, but they also take a lot of risk. You wanted in and now you're looking at the downside? Who are these clowns?

I agree with all of this Locke except for the first sentence. I don't believe the players ever really wanted to be revenue sharing partners and it took a season long lockout to get to a salary cap based on revenue.

When you hear players complain about escrow they're really complaining about having salary tied to revenue IMO.

[Strange Brew]

Originally Posted by Textcritic

Gee, I wonder if it has anything to do with the fact that players are not enthusiastic about isolating in highly controlled hubs for weeks or months on end.

I am sure they don't but it might be the safest way for them to continue earning a paycheque.

Perhaps the league should evaluate the costs of different scenarios and take it to the players for input. Maybe the players would be willing to help defray the costs for their preferred option?

LOL who am I kidding.

[iggy_oi]

Originally Posted by Enoch Root

You are confusing revenue sharing with escrow. The players don't like escrow because they don't understand it.

They very much do like revenue sharing though.

How do you think I’m confusing revenue sharing with escrow?

The players understand escrow, their opposition to it is that it can result in them not receiving the full value of the contract they signed if revenues fall short. Which strongly suggests they don’t want their salaries directly tied to revenues.

This narrative you and Locke keep trying push that the players wanted to be 50/50 partners with the league and to have their salaries linked to revenues simply isn’t supported by the facts. If that’s what the players really wanted they would have never gotten a 57% share of the revenue in the CBA after the first lockout. I think we can all agree that the league would have preferred to have and agreed to have a 50/50 split at that time.

[Strange Brew]

Originally Posted by Bingo

I haven't dug into the details, but from a distance I think this is more about escrow timing than anything.

The escrow true up will solve whatever the revenue short fall is ... in time. But if they set the ratio to games played when the actual pie shrink will be more than that. And if that's the case some teams may not make it out the other side.

It's not a simple proration.

Did some digging on revenues and roughly the following seems to be true.

Total Revenue - $5B USD
Tickets & Concession 44% or $2.2B
TV 49% or $2.4B
Other 7% or $0.4B

If they play say 56 games it's not as simple as 56/82 * $5B. The proration works for TV and it works for "other", but the first category becomes zero.

At zero for tickets and concession etc the pie shrinks to $1.9B or 38% of the 2018-19 season.

That's not easy to finance as you wait for the escrow smoothing to fix things.

And arguably it's the owners who are taking on 100% of the extra costs for testing, the bubble whatever. So yeah that's a tough sell for an owner to advance 80% of expected salaries when they're receiving 38% of expected revenues.

As Jiri said earlier, the essence of the players argument seems to be the owners should be floating this differential (because interest rates are low) which will ultimately be paid back by future players.

Although I am not very pro player in this, there is an argument to be had that the cost of this type of generational event should not be borne exclusively by current players and makes sense to spread out over time. That's where having a union comes in handy.

[powderjunkie]

Originally Posted by iggy_oi

If the NHL signed off on this agreement based on their expectation of a best possible outcome then why would they deserve a mulligan? That’s a terrible way to run any business, let alone a major pro sport league.

It'll come down to contract details, but presumably SPC's are structured around 82 game seasons with some language related to shortened seasons/proration - but I would venture that language isn't water-tight.

The league's argument is simple: the deal signed was based on 82 game reg season. If the players insist that season length has no bearing on compensation, then they better be prepared for 90 game seasons.

Originally Posted by iggy_oi

Facts have no bias. The players are obligated to pay the elevated escrow and to take the salary cuts they agreed to regardless of what happens. Not sure what you’re basing your argument of that not being the case on.

Citation needed. Everything I've seen frames those figures as escrow caps/limits. Once both parties are made whole, there is no reason to believe that escrow wouldn't be returned to the players to maintain 50/50.

Originally Posted by iggy_oi

How do you think I’m confusing revenue sharing with escrow?

The players understand escrow, their opposition to it is that it can result in them not receiving the full value of the contract they signed if revenues fall short. Which strongly suggests they don’t want their salaries directly tied to revenues.

This narrative you and Locke keep trying push that the players wanted to be 50/50 partners with the league and to have their salaries linked to revenues simply isn’t supported by the facts. If that’s what the players really wanted they would have never gotten a 57% share of the revenue in the CBA after the first lockout. I think we can all agree that the league would have preferred to have and agreed to have a 50/50 split at that time.

Then they don't understand what the full value of their contract is. In reality, every contract is signed for a percentage of a percentage of TBD totals (HRR and total player salary allocation).

[Enoch Root]

Originally Posted by iggy_oi

How do you think I’m confusing revenue sharing with escrow?

The players understand escrow, their opposition to it is that it can result in them not receiving the full value of the contract they signed if revenues fall short. Which strongly suggests they don’t want their salaries directly tied to revenues.

This narrative you and Locke keep trying push that the players wanted to be 50/50 partners with the league and to have their salaries linked to revenues simply isn’t supported by the facts. If that’s what the players really wanted they would have never gotten a 57% share of the revenue in the CBA after the first lockout. I think we can all agree that the league would have preferred to have and agreed to have a 50/50 split at that time.

lol

They signed a CBA agreeing to exactly that. Those are the facts.

[powderjunkie]

Originally Posted by Enoch Root

lol

They signed a CBA agreeing to exactly that. Those are the facts.

After missing an entire season trying to avoid it. The facts are the facts, but I think there has been some mischaracterization of the players' desires/motives in this regard...

[iggy_oi]

Originally Posted by powderjunkie

It'll come down to contract details, but presumably SPC's are structured around 82 game seasons with some language related to shortened seasons/proration - but I would venture that language isn't water-tight.

The league's argument is simple: the deal signed was based on 82 game reg season. If the players insist that season length has no bearing on compensation, then they better be prepared for 90 game seasons.

I don’t think the players have opposed prorating their contracts based on games played, in fact they already did so for next season. I’m not really sure what that has to do with this.

Citation needed. Everything I've seen frames those figures as escrow caps/limits. Once both parties are made whole, there is no reason to believe that escrow wouldn't be returned to the players to maintain 50/50.

https://www.google.ca/amp/s/www.thes...agreement.html

The escrow rate — the percentage of player salaries withheld during the season as a way to ensure teams and players achieve a 50-50 split of hockey-related revenue — will be 20 per cent next season, up from 10 per cent, then drops to 18, 12 and nine per cent in subsequent years. The players are also taking an additional 10 per cent deferral (from salary and signing bonuses) that will be paid back to them through the next three seasons.

Previously escrow was calculated multiple times throughout the season based on a formula, now it is set at a fixed rate so even if the league recovers quicker than expected the players will still pay the higher escrow amounts. I haven’t read the actual MOU between the league and the players but my interpretation is that these caps aren’t caps so much as they are set escrow amounts(with the exception of the second year which I’ve previously seen reported as being 14-18%)

Then they don't understand what the full value of their contract is. In reality, every contract is signed for a percentage of a percentage of TBD totals (HRR and total player salary allocation).

I agree that is how their contracts essentially work out, though it’s a bit of an oversimplification because I don’t believe excess revenue is split amongst the players based on their salary, could be wrong about that though. What I’m saying is the players understand this too, but they don’t like that system because they prefer the monetary guarantee over the percentage of revenue guarantee. The pros and cons of either is a whole other debate.